High levels of aromatic amine, a carcinogen found in some dyes, were found in 10 percent of the 91 batches of clothes checked between January and March by the Administration of Industry and Commerce in Guangdong Province, the China Daily newspaper said.

In some cases, the levels of aromatic amine were 10 times above acceptable levels, it said.

The newspaper cited an administration official as saying the substance could cause bladder or urethral cancer if left in contact with the skin for a long period of time.

The report did not say if any children had been sickened by the clothes.

The clothes were found on sale at 22 supermarkets in six cities in Guangdong, including Guangzhou and Shenzhen, it said.

The administration released a list of 51 clothing brands that failed the tests, including Bettyboop, e.baby and Mina, it said.

Meanwhile, health officials in China, where fake baby powder led to the deaths of at least 13 babies two years ago, were also searching supermarkets for baby bottles "that may have been made from recycled compact discs," the Shanghai Daily said.

The bottles, first discovered in a spot check and since found in more than 10 wholesalers, contained twice the legal limit of hydroxybenzene, a chemical that dissolves in heated milk and causes liver and kidney damage, the newspaper said.

Reclaimed plastic was used to make the bottles because it is "much cheaper than clean material" a factory manager was quoted as saying.

Three factories had been closed, the paper said.

The national study also examined toys, failing 83.3 percent of cloth toys and 37 percent of toys overall, the China Daily said. It did not elaborate.

In 2004, China launched a crackdown on milk powder sales after at least 13 babies died and nearly 200 fell ill after being fed fake milk powder in a scandal that drew attention to the widespread problem of pirated goods.

An inspection team also found more than 50 companies had produced inferior-quality milk.

US retail giant Wal-Mart Stores Inc said yesterday it had taken several brands of children's clothes off its shelves in China.

Wal-Mart stores in Guangdong Province were selling nine Chinese brands of children's clothes that contained a dye that could decompose into toxic aromatic amine compounds, the Beijing News reported.

One of Wal-Mart's Beijing stores was also selling some of the brands, the Beijing Daily Messenger said.

Wal-Mart acknowledged yesterday that children's clothes containing the harmful dye were sold at those shops and said the company had suspended selling them while an investigation took place.

"[This] is unacceptable. We are currently investigating ... to prevent similar incidents from happening," said Huang Jianling, manager of public relations of Walmart's China head office in Shenzhen.

"We are actively cooperating with relevant government departments," Huang said.